Univ of Nevada Gets $1 Million From Tesla For Battery Research

All of the drama over the last few years concerning where Tesla would build its first Gigafactory carried with it a lot of potential implications for the states in question, hence the jockeying for position and the various meetings between Tesla officials and state officials.

On that note, one of the perhaps lesser of these implications recently revealed itself with the announcement that Tesla will be investing $1 million into battery research at the University of the Nevada in Las Vegas over the next half decade. The move is unsurprising, as it was a requirement stipulated in the deal last year that Tesla would invest in educational research in the state. But it’s still worth highlighting.

Granted, considering that the Gigafactory is going to create up to 6,500 jobs (once at full capacity), and cost $5 billion to finish, one assumes that caveat wasn’t a high priority. Nevada seems to have been pretty set on luring Tesla to the state, though, as the company was eventually offered a deal that will see the EV manufacturer receive up to $1.3 billion in tax incentives over the next two decades.

Local newspapers reported on the signing ceremony taking place Wednesday afternoon with Tesla and UNLV (University of Nevada in Las Vegas) representatives as well as Governor Sandoval.

Sandoval commented on the deal: “It brings it all together. It brings North and South together. It brings cutting-edge technology together with cutting-edge research at this university.”

The Governor said Tesla not only delivered on its promises but exceeded them. Tom Piechota, UNLV’s interim vice president for research and economic development, said that most of the research under the agreement will be proprietary to Tesla and the university and the deal also includes helping the company study “manufacturing, water treatment, recycling and the behavior of certain metal materials.”

Interesting news. While the battery research is no surprise, the deal actually sounds far more encompassing. I wonder how many of the findings coming from those areas of study will be put to direct use at the Gigafactory?

About the Author

James Ayre 's background is predominantly in geopolitics and history, but he has an obsessive interest in pretty much everything. After an early life spent in the Imperial Free City of Dortmund, James followed the river Ruhr to Cofbuokheim, where he attended the University of Astnide. And where he also briefly considered entering the coal mining business. He currently writes for a living, on a broad variety of subjects, ranging from science, to politics, to military history, to renewable energy. You can follow his work on Google+.

With the $25,000 tax break Model X drivers will get (the Hummer tax break) – they should donate at least half that to Nevada public schools at the K through 12 level. Nevada public education is rated dead last in the US. They might need water in Nevada as well. A $1 million grant is almost nothing – except marketing. I’m going to guess the money will be earmarked for University of Nevada – Reno, Mackay School of Mines. Maybe this is just a peace offering for sourcing Lithium in Mexico and not Nevada.

I guess it’s standard, but to me it stinks that they can give special tax deals to particular companies. It’s like they’re saying, “Only the little people and the little companies have to pay tax (at the full rate)”. To my way of thinking, if they give a reduction of tax to one company, they should have to give it to every single company and business in the state, including every single Mom and Pop store. Like, I’m British, but if I decided to go and work in the States, of course I wouldn’t dream of telephoning the IRS and saying, “I’m thinking of coming over and working in your country. I see the normal rate of tax I’d have to pay on the salary I expect to get would be x%, but we all know it’s only the little people who pay the full rate of tax; now what sort of deal can you give me on that to persuade me to come and work in your country?”. Can you imagine the response I’d get to that? And rightly so.

I’m not getting at Tesla because if that’s the way the system works, they’d be fools not to get the best deal they can. But I still say that if that’s the system, the system stinks. (PS And I’m not getting at the USA in particular either because I guess the same thing happens throughout the world, including my country, in various forms. But it shouldn’t be so – there should be a set tax rate or tax structure within a jurisdiction, and it should apply across the board to everyone, no negotiating about it, and certainly no “sweetheart” deals for a particular company, be it Tesla or any other particular company.)

Bob_Wallace

Tax breaks are given to companies when it is hoped that their increased activity will produce good for the community/state/nation.

It’s common to give tax breaks and other subsidies to major sports teams and large companies in order to get them to move into (or to stay in) and area because the hope is that they will create more tax revenue than what they are being given as an incentive.

J999

Yes, Bob, I fully understand that that’s the reason, but it doesn’t make it right. It’s another way that big business is advantaged at the expense of small and medium sized businesses. Let’s put it this way. What would create more employment in a particular jurisdiction, one large company moving there and employing 5,000 people, or 10,000 small businesses moving there and each employing 2 people. Obviously (other things being equal), the latter. Now, which one is going to be able to negotiate the special tax rate? Again, obviously, it’s not going to be the small businesses. And if the big business is at risk of going bust, it just might get bailed out by the government. If ten thousand Mom and Pop stores go bust, or any other small businesses for that matter, who is going to bail them out? No-one. The government looks after its own first, then it looks after the big businesses, then the employees of the big businesses. No-one looks after the small enterprises. They are the backbones of communities, but they are entirely on their own. Big businesses even get to write many of their own regulations (look up “regulatory capture”). Small ones just get regulated to death.

You might guess, I work in a small business. And yes, I do have a chip on my shoulder.

Well beyond this small grant, the University would be well advised to become a center for this type of research. It’s a natural, with the GF right there. There is nearly unlimited potential in the field for at least a few decades. The state will no doubt be supporting them in any way they can. I mean, there is currently no Silicon Valley for renewables, is there? Why not Nevada?

Ivor O’Connor

One million over 6 years? That’s the equivalent of one professor’s pay isn’t it? (Figuring an employer usually has to pay the government and overhead about the same as what the employee sees in his paycheck…)

Harry Johnson

It’s so pathetically depressing compared to a $5 billion factory. The PTC only costs about $1 billion a year but Republicans say we can’t afford that and wind power deserves no encouragement.
Look at what we achieved in the 60s going to the moon. If only people made our climate’s future as important as we did landing on the moon, we could save our future.

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Mike333

I wonder if Natural Gas Fracking is even viable without Government Begging…

Fracking Tax Treatments

Fracking / Natural Gas Tax Loopholes:

“Free Stuff” for business’s that can’t stand on their own two feet.

1-Up front deductions: Intangible Drilling Costs

2-Tax credits for developing tight formations

3-Cost of non-salvagable equipment

4-Intangible Completion Costs: Services performed during the drilling, testing and well completion phase

5-Depreciation

6-Depletion Allowance

7-Lease Operating Expense

Joe Viocoe

Its just an educational grant…. it isn’t meant to fund anything just by itself. It is meant to be combined from other sources. That is how it has always been done.

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